The Securities and Exchange Commission said on
Wednesday it approved the Financial Industry Regulatory
Authority's proposal to require its members to report their
trades of U.S. government securities.
FINRA plans to implement the reporting program on July 10,
2017, the largest independent regulator of all securities firms
that do business in the United States said in a statement.
The data are intended to help regulators oversee the $13
trillion U.S. Treasuries market following the "flash" rally two
years ago during which bond prices swung wildly within minutes.
The cause of the event remains unclear and has raised
concerns that such disruptions could become more frequent in the
U.S. Treasury market, which has been seen as the world's safest.
In the proposal by Wall Street-funded FINRA, members would
report their trades on the Trade Reporting and Compliance Engine
(TRACE) for regulators to review and the reporting would not be
"This marks the first time a regulatory trade reporting
regime has been established for a significant segment of the
U.S. Treasury market, which will enable regulators to better
understand market dynamics and exercise their oversight
function," SEC Chair Mary Jo White said.
FINRA said the reporting requirement will apply to all
Treasury securities excluding saving bonds.
U.S. regulators have examined whether the growth of
algorithmic, high-speed trading in Treasuries might have played
a role in the flash rally.
Reporting data on Treasuries trades may help shed light on
structural changes in the market, proponents said.
"The more information regulators have about the market's
functioning, participants and asset prices the better.
Furthermore, we don't believe additional transparency will have
any impact on liquidity," said Kevin McPartland, head of market
structure and technology research at Greenwich Associates in
He cautioned, however, that the sizes of Treasuries trades
may decline on fears about a leakage of trade data to the